What is the net change in welfare

Reference no: EM133614160

Problem: We ran through a simple version of Williamson's (1968) model of a merger to identify the key welfare trade-off. On slide 15, I leave as an exercise to re-do that analysis using Cournot duopolists instead of Bertrand duopolists. That is, there are two identical firms with identical products competing a la Cournot. They merge, and the result- ing monopoly has lower marginal costs and greater market power. What is the net change in welfare?

Reference no: EM133614160

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